Welcome to Tony's textile Factory

Anthony Wilson, 56, is as bombastic as ever. The man behind Manchester's Hacienda nightclub and Factory Records, which produced some of the most influential bands of the past 25 years predicts that Burnley 'will be the new Seattle' and declares that East Lancashire 'is more important to human civilisation than the Valley of the Kings'.

He's got to be having a laugh. Burnley is so racially at odds that it elected eight British National Party councillors three years ago, though two have subsequently fallen by the wayside. And the wider east Lancashire region has produced one of the most dire statistics in Britain: life expectancy for women is two years shorter than it was 50 years ago. This all adds up to possibly the biggest regeneration challenge in the country.

Then last year in stepped Wilson and Yvette Livesey, a Miss UK and Wilson's 'business partner and lover' for 15 years. They had never previously been hired as major regeneration practitioners. 'When we got the job we thought, "Oh my God, this is tough",' Wilson admitted. 'But the more we thought about it, the easier it became. The physical infrastructure is fantastic, and there's the closeness to Manchester.'

Wilson points to the success at regenerating Manchester as an example of what could be achieved in east Lancashire. '[Manchester] was completely derelict in 1975. It was dirty. It was spat out. It was decaying. The attempt to regenerate it - building wonderful modern-looking flats - had become the symbol of urban disaster. It was dreadful - and you look at it now.'

Wilson believes hands-on experience in regeneration is not entirely necessary. 'I know everything, don't I?' he said. 'Because I lived right through it. I lived through the most complex example seen in Britain. I was intimately involved from the first beginning. If you can't learn from watching something right inside it, when can you?. The fact that Yvette is a former Miss UK and that I'm Mister Motor Mouth is of assistance to getting the word out there.'

And the word is spreading. Last year they published an ideas paper for the region. Last December, Elevate East Lancashire, the region's housing market renewal agency, hired the pair to put it into practice. In typical Wilson fashion, the ideas are coming thick and fast: a fashion tower for Burnley, a major interactive football attraction in Blackburn and an extreme sports centre in Rossendale.

Throughout the region, rebranded Pennine Lancashire, the Livesey/Wilson partnership want to see a series of allotments to encourage women and children to grow healthy food. Together with Elevate, they will draw on the area's food heritage of pies, cheese and curry. Are you linking up with Jamie Oliver? The suggestion offends Wilson's sense of regional pride: 'No, we've some cooks up here as well.'

Waste ground will be turned into small football pitches with banked seats where kids can play 'little league'. Links have been made with the Football Association, though how much money the FA has to spend on grassroots projects while the doomed Wembley stadium project sucks up cash is a moot point.

Town squares, meanwhile, will be smartened up to give communities a renewed sense of identity.

Leaning on perhaps bitter experience - Wilson twice faced financial disaster - he wants fledgling businesses to get the services of a bookkeeper for one day a week. This plan is now circulating at Number 10.

Underpinning these proposals are plans by Elevate, led by Max Steinberg, to create two new business parks in the area. Given that Manchesteris just 30 minutes by motorway, Steinberg hopes these centres will host food technology, IT and aerospace businesses. And he is co-coordinating a campaign to establish a university.

Today, what was the cradle of the 19th-century industrial revolution is on its knees. The textile industry, which supported a population of 500,000, collapsed 50 years ago and nothing significant replaced it. Wages are 16 per cent below the north-west average. Some 20 per cent of working-age men suffer from a limiting long-term illness. The housing market has virtually keeled over. Of the 85,000 homes, a quarter are unfit and some 8,000 are empty.

In fact, one high-powered housing official privately despaired that the scale of the problem was insurmountable and wondered just how much cash it would take to turn things around. But the government is backing Elevate. Last month the agency won a 40 per cent increase in funding - £95m until 2008, with an extra £35m coming from other agencies.

The challenge for Wilson and Livesey is to produce a detailed business plan by this autumn so that Elevate has a costed vision it can take to government departments in the run up to the three-year departmental spending review to be unveiled in July next year.

There is also a need for building work to begin next year to convince people that real change is in the air. So far, Pennine Lancashire has seen limited improvements. Towns have been cleaned up and 1,100 homes have been improved with nearly 600 demolished. What's needed, believes Wilson, is an iconic attraction that will do for the region what the Eden centre has done for the south-west. This is where the Burnley fashion tower comes in.

The Tower, in a huge mill, will be based on the Guinness Storehouse, Ireland's top fee-paying visitor attraction in Dublin. In fact, the man behind Storehouse, Ralph Ardill, has agreed to work on the project, which will include business space for young designers: the north-west produces more award-winning designers than any other place in Britain. And Wilson is talking to investors about the project. Lottery funding will also come into play, he envisages.

'The reason the fashion tower is so important is that there have been only two real changes in humanity's history. One was when we stopped being nomadic hunters and became farmers, and that happened in Mesopotamia and the banks of the Yellow River in China. And the second is when we stopped being farmers and became industrial modern people, and that happened here which makes it the epicentre of the world at a certain point in history. This is why Lancashire is historically more important than the Valley of the Kings and should be celebrated in some way.'

Likewise, a football visitor attraction could bring people into the area from miles around. 'Of the 12 original football league clubs, three were from Pennine Lancashire: Blackburn, Burnley and Accrington Stanley. How can we be the birthplace of the most popular pastime in the world and not mine it?'

If Wilson can pull this off - which is the hard part - it will be the biggest achievement of his life. Both Wilson and Livesey say that in many ways, Pennine Lancashire represents the easiest regeneration challenge in Britain. And the weird thing is, if you put all the components together and take in what is the beauty of the place, maybe they're right.